As part of Labour’s plans to rejuvenate the high street and protect local communities, the party has announced it will make major changes to the banking law that will prevent banks closing their vital high-street branches and damaging local communities and small businesses.
The Consumers Association reports that 1,046 local bank branches closed in the UK between December 2015 and January 2017, with another 486 already scheduled for closure this year.
But the big four banks made over £11bn profits from their high street banks in 2015. Many have argued they can afford to provide this vital customer service instead of prioritising cost-saving measures that can damage communities and small businesses.
Cllr Stephen Morgan, Portsmouth’s Labour Leader, said:
“Over two-thirds of small businesses report that a local bank branch is important and lending to small businesses has been found to drop by 63 per cent in areas with a recent bank branch closure.
For deprived communities and households, loss of a local bank branch significantly diminishes their abilities to access even basic financial services. Older people are significantly less likely to use internet or phone banking services.
We’ve seen too many bank branches close in our city over the years. Labour will put in place the legal obligations to bring banks into line and stand up for our high streets, communities and small businesses.”
Labour believes action is needed on our major banks to prevent them putting their profits first and making short-sighted decisions which affect communities. The toothless Access to Banking Protocol would be enforced by law to bring banks into line.
Banks receive considerable financial support from the public and in return should be required to provide financial infrastructure that meets the needs of individuals and businesses.